Luxury homes may give space to affordable ones

Luxury homes may give space to affordable ones
Mona Mehta
Posted online: Monday , March 17, 2008 at 0103 hrs IST



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Mumbai, Mar 16 Its not just the stock Markets, the real estate Markets are also facing a neat correction. This year could see a drop in the ‘high value’ properties market since retail customers are looking for buying homes that cost less than Rs 50 lakh. This is what builders, property portals and international property consultants are suggesting.

Says Aditya Verma, business head, Makaan.com, which gets on an average 7 lakh visitors a month, “Most visitors access Makaan.com primarily to look for properties meeting their requirements. Based on this vast user base, we can confidently say that 70% visitors are interested in properties below Rs 50 lakh. The trend in this data suggests that there will be a drop in high value properties. So, 2008 will see more upcoming projects in less than Rs 50 lakh bracket.”

Anuj Puri, country head and chairman, Jones Lang LaSalle Meghraj, agrees, “Most major Indian developers are now actively getting into affordable homes to meet the existing shortage of 25 million residential units in the country. This is also a means for them to hedge the downside of a drop in the demand for luxury homes. There is a huge demand for residential units in the Rs 30-50 lakh range, but the metros have next to nothing to offer.” This, he says, makes the demand for middle-income homes much higher than that for luxury homes, presenting a lucrative and ongoing option for such developers to play the volume game in middle-income housing. However, most of these developers continue to develop high-end homes to meet the demand that exists.

Parag Munot, managing director, Kalpataru Properties, says, “With stability in the real estate market and a slowdown in stock Markets, it is time to evaluate pricing propositions. We may see some changes in the industry in the next three to four months. For example, in Thane and in Mira Road (Mumbai) we are developing affordable housing, where a 1,200-sq ft property costs Rs 48 lakh. In Chennai and Bangalore customers can find properties below Rs 40 lakh.”

Hemant Shah, chairman, Akruti City, said, “We are seriously thinking of providing affordable housing to masses.’’

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